Upside, Downside Movers in the Morning

Avatar photo Doug Kass on July 7, 2026

Upside:

-CRNX +99% (to be acquired by Vertex at $85/shr in cash, valuing it at $10.0B)

-PDYN +6.5% (executes AFRL HANGTIME contract for SwarmOS multi-domain autonomy)

-FISV +4.9% (JPMorgan, BOFA, and other banks held preliminary talks for acquisition of Fiserv’s network)

-NET +3.3% (Scotia Howard Weil Raised NET to Sector Outperform from Sector Perform, price target: $300)

-MGTX +3.0% (enters up to $400M royalty and equity financing with Oberland Capital)

-SHEL +2.6% (to divest Shell Downstream South Africa tto ADNOC Distribution at implied EV of $1B; reports Q2 upstream production)

-PLUG +2.2% (to supply GenEco PEM electrolyzers for 50 MW Hunter Valley Hydrogen Hub in Australia)

Downside:

-RIVN -11% (Q2 revenue guidance; files to offer of up to 75M shares)

-WDC -6.0% (sector weakness)

-AMD -3.9% (sector weakness)

-INTC -3.5% (sector weakness)

-ON -3.4% (to divest two chipmaking plants to reduce costs)

-AVGO -2.3% (hearing Erste Group Cuts AVGO to Hold from Buy)

Positions: None.

El-Erian

Avatar photo Doug Kass on July 7, 2026

Positions: None.

Treasury Auctions, Fed Speaker, Economic Calendar

Avatar photo Doug Kass on July 7, 2026

Treasury Autions

11 a.m. : Treasury Announces a 4, 8 and 17 Week Bill Auction; 
11:30 a.m.: Treasury hosts a $52B 52 and a$90B 6 Week Bill Auction; 
1 p.m.: Treasury hosts a $58B 3-Year Note Auction

Fed Speaker:

7:00 a.m.: Fed Vice Chair for Supervision Bowman (Voter) delivers opening remarks at the Financial Stability BoardVirtual Outreach Event, Virtual

Economic Calendar

Positions: None.

From Rosie

Avatar photo Doug Kass on July 7, 2026

Key Takeaways

· Extreme Bubbles In Valuations and Earnings: The data are haunting. The CAPE multiple of the S&P 500 today now classifies as a 2.9x sigma event — closing in on the bubble high of 3.3x back in December 1999. Lest you take solace, it is way higher than the 1.8x SD event ahead of the 1929 crash. The thing is, EPS growth is now so out of line with historical norms, let alone nominal GDP trends, that it has now reached a 4.6 sigma event — compared to 0.9x at the peak in early 2000. Under a more normal profit stream, the CAPE multiple would be a 4.6 SD event (see page 10 of the Financial Times for more).

· Signs of Consumer Strain are Hard to Ignore: What the bond market clearly didn’t see was the page B3 article in today’s Wall Street Journal titled Walmart Cuts Prices, Draws Praise From the President. The retail giant, with annual revenue topping $700 billion, is cutting prices on thousands of goods. Now watch its competitors forced to follow suit. On the very same page, we see Pawnshop Chain’s Demand Rises With Living Costs — second-hand and consignment stores are in a huge bull market, and just like the shift in the labor market towards multiple-job-holders, a vivid sign of consumer financial strain. Great environment for the Fed to be contemplating a rate hike, don’t you think?

· Affordability Crisis Leads to Family Reunification: This is not an official data point per se, but probably should be. See Movin’ In: Kids in 20s Are Living Back Home on the front page of today’s Wall Street Journal. The affordability crisis on full display. Almost half of U.S. adults under the age of 30 have moved back home — up +12 percentage points from the pre-COVID level in 2019. The reason? Fully 55% of young adults who moved back home said it was out of “financial necessity.” Rents have come down, but are too high at a time when many recent college graduates are saddled with massive volumes of student debt ($1.7 trillion), which no longer receives government support (hence a 10%+ delinquency rate).

Position: None